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DOW up triple digits, moderate melting up, but, trading is mostly sideways as oil trends higher. Investors are worrying about US economy heading into 2016 and the 'Grinch' stealing the Santa Claus Rally'. Some analysts are saying that holiday liquidity is here. Don't expect it back in the full swing until at least January 4.

What Is Moving the Markets

WASHINGTON (Reuters) - New orders for U.S. manufactured capital goods fell in November and the prior month's increase was revised sharply lower as the drag on manufacturing from a strong dollar and spending cuts in the energy sector showed little sign of abating.

TORONTO (Reuters) - Oil rose more than 3 percent on Wednesday in thin, pre-holiday trading, buoyed by a surprise drop in U.S. crude inventories, but prices stayed near multi-year lows as global supplies remained abundant and OPEC lowered the demand outlook for its exports.

SAO PAULO (Reuters) - Wal-Mart Stores Inc is considering closing about 30 stores and renting some of its property in Brazil next year, Brazilian newspaper Valor EconÃ´mico reported on Wednesday, as the world's largest retailer looks to exit poor-performing markets.

CARACAS (Reuters) - Venezuelan state-owned oil company PDVSA on Wednesday said it was the target of a smear campaign by opponents who are trying to link it to corruption, and said its hiring processes followed the law.

Our point yesterday was that the Fed and its Wall Street fellow travelers are about to get mugged by the oncoming battering rams of global deflation and domestic recession.

When the bust comes, these foolish Keynesian proponents of everything is awesome will be caught like deer in the headlights. That's because they view the world through a forecasting model that is an obsolete relic—one which essentially assumes a closed US economy and that balance sheets don't matter.

By contrast, we think balance sheets and the unfolding collapse of the global credit bubble matter above all else. Accordingly, what lies ahead is not history repeating itself in some timeless Keynesian economic cycle, but the last twenty years of madcap central bank money printing repudiating itself.

Ironically, the gravamen of the indictment against the "all is awesome" case is that this time is different——radically, irreversibly and dangerously so. High powered central bank credit has exploded from $2 trillion to $21 trillion since the mid-1990's, and that has turned the global economy inside out.

Under any kind of sane and sound monetary regime, and based on any semblance of prior history and doctrine, the combined balance sheets of the world's central banks would total perhaps $5 trillion at present (5% annual growth since 1994). The massive expansion beyond that is what has fueled the mother of all financial and economic bubbles.

Oil prices rallied to a nearly two-week high Wednesday after government data showed an unexpectedly large decline in U.S. stockpiles, a rare reprieve from the flood of oil that had been flowing into storage.

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